Strategic positioning can be defined as the personality of a company or an organization. It is influenced by several factors including the history of the organization. Other factors include personal preferences of the management, organizational culture, staff competency and skills, physical capital such as equipment and machinery.
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Operational positioning acts as a promotional and communication tool for a company’s products. It’s aimed the perception of the product thus improving product image. The following paper delves into differences between strategic and operational positioning. Also, it provides practical examples using Nike and Heinz operations.
Differences between Strategic positioning and Operational positioning
Strategic positioning defines the level at which the organization competes (Ellson, 235). Physical capital, competency and skill of the staff are key determinants of a company’s corporate objectives and strategies. Corporate objectives are influenced by aspects such as market segmentation.
Market segmentation creates both discrete and homogenous consumer groups. Marketing objectives, therefore, are based on the market segmentation. Operational positioning, on the other hand, is based on marketing objectives. It focuses on the needs of the above consumer groups. Promotions are used to change the perception of the product and its ability to satisfy the customer’s needs.
Strategic positioning aims at giving the company a competitive edge (Ellson, 235). This is achieved by ensuring that a company’s organizational behaviour is unique and different from that of its competitors. Organizational behaviours and traits define its corporate personality.
An organization, therefore, is able to incorporate the needs of the customer that it aims to satisfy. Operational positioning, on the other hand, is an extension of the corporate personality of the organization. Therefore, operational positioning which defined of various marketing programmes designed as guides towards promotion of a product. Tony O’Reilly, for example, while at Heinz, was able to implement successful marketing programmes. Therefore, Heinz was in a position to compete with other low price supermarket brands.
Strategic positioning defines a company’s target market. A company’s target market is primarily influenced by resources available including human and physical capital. After evaluation and selection of the target market, a company develops market programmes that are aimed at capturing the different needs within the market.
Through operational positioning, a company is able to address varied needs of customers through production of unique products. Nike’s CEO has indicated the company’s intentions to move to the Far East market. Therefore, the company will have to set up plants in such countries as China.
Marketing programmes developed as a part of strategic positioning are aimed at giving a company competitive edge through differentiated attributes. Differentiated attributes dictates the response of a company to the environment. It is influenced by the style of leadership in the organization.
Operational positioning, on the hand, is determined by company’s differentiated attributes reflects on the company’s unique response to the environment. Nike’s CEO has indicated Nike’s shift in strategy to production of more sports oriented shoes. This reminiscent of the CEO’s passion for low price, quality sports shoes.
Strategic positioning creates a link between the organizational needs and market needs (Ellson 240). Organizational needs include improving the organization’s bottom line while maintaining low costs. Operational positioning is primarily directed towards satisfying market needs. For example, when Tony O’Reilly took over the Heinz transformed the company into a market leader. He put emphasis on development of strong brands which became part of the company’s marketing strategy.
Strategic positioning can be a catalyst to change (Ellson 240). This is highly dependent on the management’s ability to accommodate and accept the change. The primary objective of change is to increase the company’s profitability. Operational positioning is related to implementation of the proposed change. Change includes internationalisation of operations. Heinz, for example, has been able to establish successful brands in different countries.
Strategic positioning encompasses introduction of incentives that support organizational practices (Ellson, 239). Incentives including employee incentives are aimed at sustaining the company’s organizational culture. Incentives motivate workers where thus reflect in increased operational effectiveness. Therefore, product image includes both visible and invisible attributes of a product. Operational positioning aim at promotion of the product image but may project the wholesome image of the project.
Operational positioning is heavily reliant on customer feedback. Through customer feedback, customer needs are identified and thus promotion is geared creating a perception of the product’s ability to satisfy the customer needs. Strategic positioning entails an analysis of customer feedback in relation to the corporate objectives.
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Therefore, it’s a gradual change of the organizational culture towards satisfaction all the customer needs. Nike’s move to the Far East is coupled with experience of a new culture. While through operational positioning, the company is able to deal with short term consumer needs, it will have to gradually incorporate the culture into its corporate goals.
Strategic positioning is aimed at giving a company a competitive edge. The company, therefore, has to institute differentiated attributes that are form part of the company’s image. Operational positioning concentrates on improving the product image and perception. However, both strategic and operational positioning are related as they both are aim at creating an improved image and perception of the company.
Ellson, Tony. Culture and Positioning As Determinants of Strategy, Personality and the Business Organization, London: Palgrave Macmillan, 2004. Print